I did not really “get” the happiness Friday, as not much seemed to be resolved other than some language for more unity and to “hold people accountable” for excessive debt in the Eurozone. However, the current treaties are supposed to “hold people accountable” for excessive debt, and hasn’t done a darn thing. I guess expectations were just so low, anything would have made the market happy for the day.
Well here we are Monday and Italian 10 year debt yields have again exploded upward, and we have another warning – this time from Intel (INTC). They are blaming the Thai floods (i.e. supply chain) rather than end demand, so some are viewing it differently than the Dupont, Altera, and Texas Instruments warnings. But for fans of ‘decoupling’ (the current hot meme on CNBC – recycled from late 2007 and early 08) we’re starting to see more chinks in that armor.
The S&P 500 remains in the battle of the 200 days…. until we break out one way or the other the Pavlov dogs will buy the bottom of the range and flip towards the top. Rinsing, washing, and repeating along the way. This is the 8th session we’ve been wholly contained within the 200 day EMA and SMA.
On the economic front, we have retail sales tomorrow, some regional fed type of surveys later in the week, and inflation gauges (which no one cares about since there is no inflation reading that will stop the Fed from staying in ultra ease mode). Also a Fed meeting tomorrow with no expectation and a ton of bond auctions Thursday. But Europe dominates everything…